Call/Meeting Summary: China Travel, BitMind Crisis, and Applied AI Community Building

Overview

Ken and Gary catch up over dinner in Austin, covering Gary's recent trip to China for his brother's wedding, Ken's decision to lay off his entire BitMind team after an investor failed to deliver $1 million, and Gary's new direction building an Applied AI Engineer community with Travis's support. The conversation ranges from surveillance state comparisons to startup survival strategies, creative vs technical co-founder dynamics, and political commentary on Venezuela and California tax policy.

Key Topics Discussed (from Gary's perspective)

Gary's China Trip Experience

• Brother's Wedding: Gary traveled to China for his brother's wedding, visiting Beijing, Xi'an, and Shanghai. He was already tired from traveling through Singapore and Thailand, which affected his experience.

• Surveillance State Observations: Gary found China's surveillance "so much more in your face" compared to the US. Noted that while both countries have similar surveillance capabilities, China makes it more explicit—Uber rides send messages that everything is recorded, audio is recorded, everything is watched. Tourist sites like the Great Wall require passport verification and gated access.

• Travel Complications: Gary's mom gave wrong passport numbers for his sister-in-law and her family, causing all reservations to be messed up. Chinese staff treated her "like a fraudster" and yelled at her in Chinese, making the situation uncomfortable.

• Luxury Electric Car Culture: Observed China's "getting-driven-around culture" because human labor is so much cheaper. Noted there are 8-9 luxury electric car brands that are "really, really nice" (equivalent to high-end BMW or Mercedes-Benz) but relatively cheap with luxurious interiors.

• Subsidized Housing Observations: Described seeing "miles and miles of subsidized housing" - cookie-cutter giant buildings that look dark and gloomy, with one nice downtown area per city. Felt like US is "really shielded from the pace of innovation" and "the democratization of luxury stuff."

Ken's BitMind Crisis and Layoffs

• Investor Didn't Deliver: An investor who had committed $1 million didn't come through. Ken was left with only crypto treasury, which isn't advantageous to sell right now due to BitTensor changes and would hurt the company long-term.

• Decision to Lay Everyone Off: Ken laid off his entire team in mid-December (mid-early December). He gave everyone the last two weeks of December off as paid holidays and paid everyone out. Ken explained he was overwhelmed and couldn't think clearly about the complex multivariable decisions ahead. The advice was to "reduce the variables here" - so he eliminated the team to simplify the situation.

• Team's Response: Many team members still wanted to work for free and figure things out, but Ken felt that wouldn't be "doing them any favors." The team understood - Ken was honest, explaining that his job is to ensure the company's financials are good, and they're not, so this was his fault. People understood it's "part of the game" - they "signed up for the risk."

• Decompression Through Physical Work: To get his mind off the overwhelming situation, Ken decided to redo his office, getting a bunch of wood and working on carpentry. Gary noted it was a "very manly way to decompress."

• Current Team Status: Ken confirmed Dylan (his other co-founder) will stay on. He's still deciding what to do next, thinking about focusing on things that can instantly generate revenue rather than going after big enterprise BD deals. He's trying to figure out what he can do right now to make money - if it launches and doesn't make money, abandon it right away. Previous burn rate with all employees was $100k/month. If he can generate $100k MRR with a small team, he'd have infinite runway to go after a bigger idea.

Gary's New Direction: Applied AI Community

• Building Community with Travis's Support: Gary is likely going to be building a community around AI with support from Travis (old friend). They've had serious conversations about it being mutually beneficial for Travis to sponsor Gary to build a community that would serve as a "dev rel substrate" for Travis's company, giving Travis access to developers.

• Applied AI Engineer Event (Jan 29th): Gary is doing an event on January 29th at Antler. The premise is that there's a "new breed of engineer called the Applied AI Engineer" - basically AI consultant companies. The event will feature a consultant explaining how they went through a whole client project, live architecting a real business problem.

• Meeting with Travis on Tuesday: Gary is chatting with Travis on Tuesday to fully get on the same page about the sponsorship arrangement.

Reflection on Lael Alexander (The "Scientist Guy")

• Ken's Warning Proved Correct: Gary acknowledged Ken was right about Lael Alexander being a scam. When Ken had warned Gary previously, Gary thought "is he right?" - and Ken was. The scam was really just Gary's time.

• Lack of Focus: Ken had warned that Lael's setup showed "a lack of focus" - unlike Elon's companies (Neuralink, SpaceX, Tesla) which were extremely focused when they started. Lael's whole career in China was being hired by companies that already had product-market fit and customers, helping them design products they already wanted to build - very different than going to markets on your own.

• Execution Failure: By August, when Gary called Lael's team about coming to Tulsa full-time, they had no idea Gary and Lael had been having conversations for weeks. The team said "oh, my payroll systems are not set up" - which Gary recognized as "the stupidest excuse of all time" and knew it was a way to "shoot me off."

• The Real Problem: Gary realized the real scam was on Lael himself - "he's incapable of saying no to people." He leads people on, then goes radio silent when execution time starts. "He's addicted to people realizing he's quite smart and having the conversations." Gary noted that to play the "Elon type of role, you better have the best possible cricket team around you and also not be a liar."

• Elon's Actual Skill: Ken observed that Elon's best skill is probably hiring and retaining talent and identifying it. "You can't do it all yourself." Gary mentioned Elon has trained up a close circle of 20 people across company after company - they're irreplaceable because they know how he thinks.

Gary's Living Situation and Spiritual Journey

• Couch Surfing Phase: After the Lael situation fell through in August, Gary couch surfed for a bit. He "read the Bible a lot" and "did a little detox."

• New Housemate: Gary now lives with someone who helped grow Ryan Holiday's Daily Stoic podcast and helps do Andrew Huberman's podcast - he literally does Huberman's clips channel. The housemate has ideas around content, and Gary wants to "wrap it up this year" with his personal content.

• Church and Pastor: Gary met a pastor he really likes and started going to his church. It's not close by - it's 4 hours away - so he goes every two weeks and stays the night. The pastor he's staying with helped him make this connection.

• Living Location: Gary now lives at 807 or 803 East 45th Street in a two-bedroom house (a "really skinny house") with a housemate he met through a friend of a friend. They share values, work hard, and the housemate is clean - which Gary emphasizes is really important. Previously, Gary was crashing with someone from Gauntlet who had cocaine addiction issues and was "pretty dirty."

Creative Projects and AI Tools

• Gary's Card/App: Ken mentioned he really likes Gary's card/app and sent it to a bunch of people. He noted the music in the background "actually adds a lot of pizazz to it." Gary mentioned it was his first meaningful project before last year, and he went through the whole iOS approval process just to see what it's like - which was "very painful."

• Gary's Weekend Story Project: Gary showed Ken a weekend project where he turned a written story into a visual story with generated audio and images. The moral was that "the tools aren't fricking good" - hard to get character consistency. Gary used programmatically generated prompts that reference the same character file, and had AI identify scenes where images would be valuable, then could regenerate or update global style. The takeaway: it's "really fun if you have an appreciation for how software can save you time in getting a very specific result you may have taken a long time to iterate towards." That's why "version control is so freaking cool."

• AI's Democratizing Effect: Gary noted "you're at such a disadvantage if you're a non-technical creator right now." However, Ken countered that it's actually the opposite - people "down here that are not super high-level on a big team can get to here way quicker because of" these tools. Ken shared his experience using AI for woodworking - he can take a picture, visualize different looks, turn it into a blueprint, measure it out, figure out what cuts he needs, and see how to place them together. Previously this would require AutoCAD and years of experience, but now he can do it himself.

• Ken's Woodworking Example: Ken is working on office cabinets and explained how AI helps him with precise cabinetry work that previously would have required AutoCAD and professional visualization. He can now figure out what tools he needs, how many cuts of wood, how many sheets of plywood - all knowledge that previously required "a couple of months deep dive or years of experience."

Startup Philosophy and Co-founder Dynamics

• The Shift from Technical/Business to Creative/Technical: Ken explained that previously you wanted a technical co-founder and a business co-founder. But that's shifted - now you need "creative and technical." You really need someone to be savvy on social media - that's your huge distribution, how you sell your product. That's much more important than having a business co-founder. But if you're doing it in a specific domain, you also need a domain expert.

• Gary's Superpowers: Ken identified Gary's superpowers as: "you're really good at ideating. You're good at inspiring people, community building, that kind of stuff." If Gary is inspired to do something, Ken thinks Gary could handle the creative side. The difficult thing about really talented technical people is "they get lost in the weeds" and "build shit just to build shit" - someone needs to guide them in the right direction.

• One-Person vs Two-Person Startups: Ken discussed how AI changes startup investing and landscape. You can build something so fast now. The investing landscape changes because you can "try five ideas, launch them, and see what revenue comes out of it." You can boom, launch it, traction, yes or no, new idea. Ken gave an example where he asked his team how long audio features would take - they said at least a month. Ken did 90% of it in a day or two (noting the hardest part is the last 10%).

• Iteration Speed: Ken believes you can iterate much faster now. "I almost feel like the investing and the startup landscape changes a little bit" - pre-seed investing is kind of "belief in people." Give someone $500k, try 5 ideas, budget each idea for $100k. If one gets traction, pivot to that. One person can move at "lightning speed in their own process."

Political Discussion

• Venezuela Intervention: Discussion about US actions in Venezuela, comparing to Panama (1989) and other interventions. Ken noted Venezuela situation is complex - everyone recognized the president in 2019, but the military didn't come through at the last minute, so Maduro stayed in power. They've tried diplomacy, grassroots espionage, etc. The current approach seemed like "the cleanest way to do it." The goal appears to be getting the vice president (a woman) into power with US support, to stop funding for drugs, Hamas, Iran, Hezbollah, and oil funding.

• Minnesota Fraud Case: Discussion about Minnesota stopping payments to HSS and investigating fraud. Ken thinks if they start systematically uncovering fraud (like the DOJ was meant to do), and if there's more public subsidies in Democratic states, there's probably more fraud there. Elon tweeted that Republicans voted against DOJ stuff because they're benefiting from the fraud too. They're estimating billions of dollars in fraud just from the Somalis. If they can track it to Somali terrorists or pirates, then it becomes federal.

• California Billionaire Tax: Ken mentioned Austin is in really good shape because of what California is doing - all the besties (billionaires) are moving to Austin. California is proposing a billionaire tax - basically taking 5% of assets one time. Ken thinks it's illegal (seizure of private property), and it's a slippery slope. If you want to do it on a large scale, you'd need to do it for high and middle class people, which would require submitting to the government everything you own. "That's just fucked up."

• Republican Party Fragmentation: Discussion about Fuentes and the Israel issue really fragmenting the Republican Party. Ken thinks "you like can't win that one." Gary suggested if he was a Democrat strategist, he would just pay Fuentes to fuck with the Republican Party. Discussion about Trump's ICE stuff being really unpopular (Sarah hates it), but Fuentes is shitting on Trump for the exact opposite - "you're not deporting enough people."

Tech Projects and Opportunities

• Jeffrey Epstein Files Tech Project: Discussion about the Jeffrey Epstein files being made searchable through a Gmail-like interface. Someone ran a script for days, OCR'd a million things, put it in a database. Gary noted this is a case study of "how someone like me feels differently than he did certainly a year ago about what I could do." This is related to Gary's thinking about a conservative funder who wants to pay Gary to run activism experiments that are Christian-aligned but also Republican-aligned.

• NYSE Fintech Opportunity: Gary mentioned someone who is a vice president at New York Stock Exchange (or something like that) was pitching him a state management platform. He needs a technical full-time. Gary noted that 12-24 months ago, he'd be like "no way." But now, as long as the person supports him with subject matter expertise and Gary can meta-architect it in a way he can follow what Claude is doing, he might be able to create a fintech product with it. He's thinking through whether he wants to dedicate time exploring this more.

• Frank D. God Example: Ken mentioned Frank D. God created something that unsubscribes people, but it would have been way more popular if he just did a GitHub repo and productized it. Ken thinks it's actually easy to do - "so what, yeah, it's buggy. It's already gonna be buggy and it's shitty." It doesn't need to be polished or open sourced. You can productize it very easily. Gary countered that even though it's way easier, it's still work, and he doesn't think Frank is welcome here (meaning in certain circles).

Miscellaneous Topics

• Mormon Documentary: Brief discussion about a popular Netflix documentary about a Mormon lady who was a couples therapist and categorized almost anything as addiction. She had a Mormon version of AA with a 12-step process. If you watched porn one time a year, she categorized that as heavy addiction. It was super aggressive. Ken noted she was on the recommended therapist list, so she was endorsed by the church.

• Conservative Funder Opportunity: Gary mentioned meeting someone who used to party with Soros in New York City, then moved to Texas, became a conservative funder, then became a Christian. This person really wants to find a way to pay Gary to run some kind of activism experiment that is Christian-aligned but also kind of Republican-aligned. Gary thinks those two things are relatively aligned. The person knows Gary's political activism story and went through Gary's whole spectrum story. He's right that Gary has "not yet weaved together tech and activism and media before" - in previous incarnations, Gary was just doing media/political media.

• Event Plans: Ken confirmed he'll come through to Gary's event (the Jan 29 Applied AI Engineer event). Gary will send Ken the room details.

Key Quotes

• Ken on reducing variables: "These are all really high, multivariable, complicated decisions. And it was like, reduce the variables here."

• Ken on team understanding: "I feel like... You know? I was like, hey. Like this is... Honestly like... It's not like... I think everyone understood. You know? I was like... Hey. Like my job is to essentially... Make sure the financials of the company are good. And they're not. So this is my fault."

• Gary on China surveillance: "It just feels so much more in your face in China... The terms and services or the, like, whatever agreements that you make when you sign up for the apps are, like, super aggressive. Whenever you get an Uber, they send you, like, this message that's like, everything is recorded in here."

• Gary on Lael Alexander: "The real scam is on himself. He's incapable of saying no to people... He's addicted to... People realizing he's, like, quite smart. And, like, having the conversations."

• Ken on Elon's skill: "I mean, I think, like, Elon... Elon's a fun guy, but I think probably, like, his best skill... At least at the skill that he's at is, like, hiring and retaining talent. And identifying. Because, like, you can't do it all yourself, you know?"

• Gary on creative projects: "I guess, what is the moral of the story here? It's really fun... If you have... An appreciation... For how... Software... Can save you time in getting... A very specific result. That you may have taken a long time to iterate towards."

• Ken on AI democratization: "If you're a top-level creator and you're not using it... You probably are using it, even if you're not technical. But now... The people down here that are not super high-level on a big team... Can get to here way quicker."

• Ken on startup co-founder shift: "Previously, you wanted to construct a company. Usually, you wanted to have your technical co-founder and your business co-founder. And I think that's shifted. Andreessen and Horowitz talk about it a lot. But you kind of now need your... It's like creative and technical. You really need someone to... Be savvy on social. That is your huge distribution."

• Ken on Gary's superpowers: "I feel like what your superpowers are is you're really good at ideating. You're good at inspiring people, community building, that kind of stuff."

• Ken on iteration speed: "I almost feel like the investing and the startup landscape changes a little bit. Because like... You know... I give you... I just believe in you. Which is kind of what... Scene stage... Pre-scene investing is. Right. Try five ideas. Launch them. Interesting. And see what revenue comes out of it."

Action Items / Takeaways

• Gary's Applied AI Event: Event scheduled for January 29th at Antler featuring an Applied AI Engineer consultant explaining a client project and live architecting a business problem. Ken confirmed he'll attend - Gary will send room details.

• Gary's Tuesday Meeting: Chatting with Travis on Tuesday to fully get on the same page about sponsorship for the Applied AI community building.

• Ken's BitMind Direction: Still figuring out next steps - focusing on revenue-generating opportunities rather than big enterprise deals. Dylan (co-founder) staying on. Investor said they're still going to come through with the money.

• Gary's Content Plans: Working on wrapping up personal content this year with ideas from his housemate (who works on Huberman and Daily Stoic content).

• Gary's Living Situation: Now settled at 807 East 45th Street in a two-bedroom house with a housemate who shares values and is clean.

• Church Commitment: Gary continuing to attend church 4 hours away every two weeks, staying overnight with the pastor connection.

Strategic Insights

Startup Survival in Crisis: Ken's approach to the investor crisis demonstrates a key survival principle - when overwhelmed with complex multivariable decisions, reduce variables by eliminating what you can. His honest communication with the team about taking responsibility ("this is my fault") while explaining it's part of the startup game preserved relationships and understanding.

AI's Dual Impact on Creators: The conversation revealed AI's paradoxical effect - while non-technical creators are at a disadvantage if they don't learn to use AI tools, those same tools also democratize access to capabilities previously requiring years of experience or large teams. The key is having an appreciation for how software can save time in iteration.

Co-founder Evolution: The shift from technical/business co-founder pairs to creative/technical pairs reflects the reality that distribution (social media savvy) is now more critical than business development skills, while domain expertise remains important for specialized fields.

Relationship as Strategic Asset: Gary's reflection that Ken was right about Lael Alexander demonstrates the value of trusted friends who can serve as "bullshit detectors" - their perspective prevented Gary from wasting more time on a situation that would have failed at execution time anyway.